Virginia’s K-12 Funding and Rebenchmarking

Process, and School Security

Virginia Association of Counties

Fiscal Analytics, Ltd.

August 15, 2019

2

# of

Students

Prevailing

Salaries Fringe

Benefits

Staffing

Ratios

Inflation

Factors

SOQ

Model

Per Pupil Amounts

- by Account

- by Division

Muliplied by Projected

Enrollment

TOTAL COST

Local

ShareState

Share

All Accounts Except

Basic Aid

Apply Composite

Index

Prevailing

Support Costs

Apply Composite

Index Subtract

Sales Tax

State

ShareLocal

Share

SOQ Funding Process

Basic Aid

“One Type Fits All”

*

* incl. remedial education and remedial summer schoolSource: DOE

Support Staffing Capped

School-age pop.

FY 2020 SOQ Funding Accounts

3

State Amount Required Local Match

Basic Aid $3,295,069,550 $2,654,298,215

Sales Tax (based on school-age pop.) $1,486,302,403 N/A

VRS Retirement $442,260,022 $357,711,445

Special Education $396,092,863 $346,853,820

Social Security $200,465,243 $162,128,277

Prevention, Intervention, & Remediation $112,320,130 $78,041,188

Textbooks $70,023,715 $55,654,083

ESL $62,519,408 $72,263,758

Vocational Education $57,930,204 $39,148,944

Gifted Education $35,314,827 $28,523,559

Group Life $13,596,751 $10,981,346

Remedial Summer School $24,976,867 N/A

Total SOQ $6,196,871,983 $3,805,604,635

FY 2020 Major Incentive, Lottery, Categorical,

and Supplemental Accounts

4

State Amount Required Local Match

Supplemental Lottery Per Pupil $255,531,948 N/A

Compensation Supplement $201,975,291 N/A

K-3 Class Size Reduction $128,005,970 $83,772,462

At Risk Add-on $120,950,476 $76,050,114

Special Education Regional Tuition $100,397,909 N/A

Virginia Preschool Initiative $72,351,058 $59,217,308

Technology VPSA $58,612,800 $10,828,960

Special Education State Programs $35,660,182 N/A

Early Reading Intervention $23,571,284 $18,844,682

Academic Year Govenor's School $18,560,517 N/A

SOL Algebra Readiness $13,061,697 $9,180,066

Career and Technical Education $12,400,829 N/A

School Security Equipment Grants $12,000,000 $3,000,000

School Breakfast & Lunch $13,241,820 N/A

Foster Care $10,387,961 N/A

All Other Programs $82,113,218 $5,313,226

Subtotal $1,158,822,960 $266,206,818

Total K-12 Education $7,355,694,943 $4,071,811,453

FY 2020-22 Rebenchmarking Process

• Re-benchmarking is the formula-driven cost adjustment which will be calculated this fall to update SOQ minimum staffing requirements and related support services, using FY 2018 base year actual data.

• The biggest cost drivers are “prevailing” salaries, the “federal revenue deduct”, health care, inflation, and various enrollment data. Other factors include free lunch eligibility, textbooks, and transportation.

5

Major Rebenchmarking Steps

6

Anticipated September Rebenchmarking Updates

Remove Virginia Preschool Initiative Nonparticipation

Remove any One-time Spending from FY 2020

Update Base Year (FY 2018) and Projected Enrollment Counts

Reset Personal and Nonpersonal Support Cost Inflation to 0% in the Rebenchmarking Model

Update Special Education Child Enrollment Counts

Update Career and Technical Education Enrollment Counts

Update SOL Failure Rates for Funding Programs

Update Positions Needed for Gifted, Support and Instructional Tech for New Enrollment Counts

Update Prevailing SOQ Instructional Salaries to FY 2018

Update Prevailing Support Position Costs to FY 2018 then Cap Based on SOQ-Funded Teaching

Positions

Update Nonpersonal Support Costs to FY 2018 (reflected local cost cutting)

Update Federal Revenue Deduct (eliminates double counting of support costs paid with federal funding)

Major Rebenchmarking Updates (Cont’d)

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Anticipated September Rebenchmarking Updates (cont’d)

Update Costs for Superintendents, School Boards, and School Nurses

Update Health Care Premium

Update Textbook per Pupil Amount

Update per Pupil Transportation Costs

Update Nonpersonal Support Cost Inflation to FY 2020

Update Instructional and Support Salary Inflation (incl. FY 2020 State Salary Increase)

Update ESL Enrollment

Update Remedial Summer School Enrollment and per Pupil Amount

Update Incentive Accounts

Update Categorical Accounts

Update Lottery Accounts

Major Rebenchmarking Updates (Cont’d)

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Additional Updates Prior to Budget Introduction:

Revised VRS Rates

Updated Five Factors for the Local Composite Index

Revised Sales Tax and Lottery Revenue Estimates

Additional Revisions to Enrollment Projections

New Free Lunch Counts

(.5 *TVRE + 0.4* VAGI + 0.1*Taxable Sales)

(0.667*ADM + 0.333*Pop.

Rebenchmarking/Policy Issues

• The “linear weighted average” methodology underfunds salaries.

- All divisions given equal weight regardless of size.

- Base year for salaries will be FY 2018. Only adjusted for state raises,

not local raises for FY 19 & FY 20.

• Nonpersonal support cost inflation adjustments only through FY 2020, not

updated in FY 2021 and FY 2022.

• Staffing ratios severely undercount actual needed division personnel.

• No rationale for support position cap.

• No rationale for eliminating certain necessary non-position support

expenditures.

• Full restoration of COCA support costs for NOVA.

9

101010101010

State K-12 Recession Policy Changes Continuing to Reduce Funding

10

Major K-12 Funding Policy Changes Since 2008 Session Session

Annual

$ in Mil.

Cap Funding for Support Positions 2009 ($372)

Adjust Health Care Participation Rates to Actual Rather than SOQ Positions 2010 ($135)

Eliminate Equipment, Travel, Misc. Expenses From SOQ Calculation 2010 ($122)

Eliminate School Construction Grants and Lottery Support for School Construction 2009/10 ($61)

Reduce funding for K-3 class size program; use Kindergarten enrollment as proxy

for four-year-olds for VPI; eliminate enrollment loss assistance 2010/12 ($40)

Include $0 Values in Linear Weighted Avg for Non-personal Support 2010 ($40)

COCA for support positions in NoVa only partially restored 2012/14 ($10)

Extend School Bus Replacement Cycle From 12 to 15 Yrs 2010 ($10)

Continuing Major Policy Changes Since 2009 ($790)

$4,084

$4,382

$4,868$4,966

$5,274

$5,000

$4,513 $4,546

$4,804 $4,862$5,028 $5,075

$5,271$5,461

$5,675

$5,893

$4,215

$4,562 $4,481

$4,692

$4,404

$3,896$3,810

$3,958 $3,942$4,048 $4,057 $4,134 $4,188 $4,239 $4,297

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

2019 Adopted State Per Pupil K-12 Direct Aid Funding

Nominal and Inflation-Adjusted (CPI $2005)

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School Construction

1212

FY 2019 Virginia Public School Construction and Renovation Costs ($ Mil.)

Number Cost Avg. Cost

New Elementary Schools 5 $157.0 $31.4

New Middle Schools 4 $198.0 $49.5

New High Schools 2 $218.7 $109.4

New Combined or Other 1 $81.5 $81.5

Additions/Renovations 40 $425.4 $10.6

Total 57 $1,080.6 mil.

Source: http://www.doe.virginia.gov/support/facility_construction/school_construction/costs/

1313131313131313131313

State Standards of Quality Do Not Reflect True Costs for Local K-12 Divisions

• Only 68 percent of K-12 positions employed by local school divisions are recognized by the

SOQ, including many support positions, assistant principals, and teacher aides; other

nonpersonal support costs de-funded after 2009; the “linear weighted average” methodology

underfunds most teacher salaries; real-time costs not reflected in re-benchmarking.

- Just raising teacher salaries to the national average and funding prevailing support costs

requires an additional $750 million GF/year.

• Localities on average spend about double, or $4 bil. beyond state requirements to meet SOL and

SOA requirement in FY 18. All 134 local school divisions exceeded Required Local Effort

(RLE) in FY 18.

Divisions up to 25% Above RLE 11

Divisions Exceeding 25% to 75% 45

Divisions Exceeding 76% to 100% 34

Divisions Exceeding 100% RLE 45

Source: http://www.doe.virginia.gov/school_finance/budget/required_local_effort/2014-2015.pdf

Instructional Pay Increases Have Slowed

Considerably Since 2009

14Source: Superintendent’s Annual Report. All instructional positions include classroom teachers, guidance counselors, librarians,

principals, and assistant principals.

$42,788

$53,581

$58,677

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

2002 2009 2018

Average Salary - All Instructional Positions*

NEA Average Instructional Salaries by State

vs Zillow Median Home Value Index

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Rank

NEA AVG

Salary - 2019 Rank

Zillow Home Value

Index

United States $64,143 United States $216,700

1 New York $86,609 1 Hawaii $615,000

2 California $82,282 2 Washington D.C. $567,400

3 Massachusetts $82,042 3 California $539,400

4 Rhode Island $78,555 4 Massachusetts $395,300

5 Washington D.C. $78,477 5 Washington $370,700

6 Alaska $76,758 6 Colorado $364,600

7 Washington $76,525 7 Oregon $334,100

8 Connecticut $76,465 8 New Jersey $316,500

9 New Jersey $75,223 9 Utah $310,800

10 Maryland $74,426 10 Alaska $307,600

11 Minnesota $71,121 11 Maryland $282,500

12 Pennsylvania $70,478 12 New York $280,000

13 Oregon $67,949 13 Nevada $275,200

14 Illinois $66,600 14 Rhode Island $273,500

15 Delaware $65,883 15 New Hampshire $264,400

16 Vermont $62,351 16 Virginia $250,700

17 Indiana $61,963 17 Arizona $240,300

18 Michigan $61,825 18 Connecticut $238,600

19 Wyoming $60,761 19 Idaho $232,400

20 Iowa $60,646 20 Delaware $231,200

21 Georgia $60,100 21 Minnesota $225,100

22 Ohio $60,091 22 Montana $225,100

23 Hawaii $59,757 23 Florida $224,600

24 Utah $59,156 24 Maine $222,000

25 Montana $58,874 25 Wyoming $219,800

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Rank

NEA AVG

Salary - 2019 Rank

Zillow Home Value

Index

26 New Hampshire $58,146 26 North Dakota $202,100

27 Nevada $57,761 27 Vermont $195,400

28 Texas $57,642 28 New Mexico $186,600

29 Colorado $56,963 29 Texas $185,800

30 Kentucky $56,187 30 South Dakota $181,800

31 North Dakota $55,927 31 Wisconsin $177,700

32 Wisconsin $55,762 32 Georgia $175,500

33 South Carolina $55,052 33 Illinois $174,300

34 Maine $55,025 34 North Carolina $173,500

35 Virginia $54,829 35 Pennsylvania $168,500

36 Oklahoma $54,711 36 South Carolina $158,800

37 Nebraska $54,623 37 Tennessee $158,400

38 Tennessee $54,148 38 Nebraska $157,800

39 North Carolina $53,975 39 Missouri $153,000

40 Louisiana $53,558 40 Louisiana $145,300

41 Arkansas $53,470 41 Michigan $143,100

42 Idaho $53,004 42 Kentucky $138,800

43 Alabama $52,701 43 Iowa $138,500

44 Missouri $52,493 44 Kansas $134,200

45 New Mexico $51,410 45 Indiana $133,700

46 Kansas $50,950 46 Ohio $132,900

47 South Dakota $50,773 47 Alabama $126,600

48 Arizona $49,892 48 Mississippi $122,500

49 West Virginia $49,499 49 Arkansas $121,800

50 Florida $48,660 50 Oklahoma $119,300

51 Mississippi $46,154 51 West Virginia $95,300

Source: http://www.nea.org/assets/docs/2019%20Rankings%20and%20Estimates%20Report.pdf

1717171717

• Targeted Teacher Compensation Adjustments for High Poverty Schools (up to $69.9m)

- 12.5% or 25% boost to teacher salaries linked to at least 55% Free Lunch schools

Or Increase At-Risk Add-on (up to $77m) – Move into SOQ and use only for instructional funding

• Teacher Leaders/Mentors ($106m) - One per 15 teachers with 2 year’s experience and 1 per 50 with 3 or more

years experience - 20% state prevailing salary boost.

• Increase ESL Teacher ratios depending on student proficiency levels ($27m)

• Specialized Student Support Personnel ($100m) - Employ at least 4 specialized student support positions per

1,000 students (social workers, psychologists, nurses)

• School Counselors ($88m) - Reaffirm 2016 recommendation of 1 to 250 students. 2019 GA partially funded

recommendation.

• Elementary School Principals ($8m) - Reaffirm 2016 recommendation to employ principal even under 300

students.

• Assistant Principals ($84m)- Reaffirm 2016 recommendation to employ Assistant Principals for each 400 students.

• Reaffirm 2016 recommendation to eliminate Support Position cap ($372m)

• Workbase Learning Coordinators and Reading Specialists ($38m).

• Expand Class-Size Reduction program to grades 4-6 ($213.8m).

SOQ Policy Revisions

Being Discussed by the Board of Education

Adopted Recommendations of

House Select Committee on School Safety

• Virginia is already seen as a school safety model, primarily due to its threat assessment teams – an expert

mix of school and law enforcement, implemented after the 2007 VA Tech shooting and Newtown, CN.

• There were 24 priority recommendations for improved school safety during the 2019 General Assembly

session in the areas of: 1) counseling & mental health; 2) training & school security improvements; and 3)

miscellaneous locality recommendations, such as mutual aid agreements with other localities to provide

emergency services; working with local fire marshals to ensure that any infrastructure improvement

complies with the Statewide Fire Prevention Code; increasing collaboration among the various stakeholders

in school safety audits and crisis management planning; and better processes for school design and security

planning that include various experts.

• Legislation and funding was adopted to:

- Increase number and realign counselors’ roles to spend the majority of their time providing direct

student services and relieve administrative duties.

- Amended the VA Community Crime Control Act so that community services can be provided to

juveniles before being brought to court.

- Increase sharing and training of best practices.

- Increase collaboration between schools, law enforcement and emergency service personnel.

- Require school crisis, emergency management, and medical response plans to be developed and

reviewed by school boards and first responders.

- Increased funding for training and personnel.

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19

2019 Session Adopted School Security Funding Changes

• $12 million for additional guidance counselors ($36 mil. requested by Governor) to lower the school counselor ratios beginning in fiscal year 2020 as follows: from one school counselor per 500 students to one per 455 students in elementary, from one school counselor per 400 students to one per 370 students in middle, and from one school counselor per 350 students to one per 325 students in high schools.

• Increased the School Security Equipment Grant annual allocation from $6 million to $12 million beginning in FY 2020 - as recommended by the House Select Committee on School Safety.

• Provided a $3 million GF increase (to $4.7 mil.) in FY 2020 for the School Resource Officer Incentive Grant Fund, funding an additional 44 School Resource Officer positions - as recommended by the House Select Committee on School Safety.

• Provided $280,000 GF in FY 2020 to the Department of Criminal Justice Services (DCJS) for Training and Standards would be used to provide annual active shooter trainings to school and communities, consistent with the recommendations of the House Select Committee on School Safety.

• Provided $428,000 GF in FY 2020 to the DCJS for Training and Standards would be used for additional training to school resource officers and school security officers, consistent with the recommendations of the House Select Committee on School Safety.

• Provided $721,000 GF in FY 2020 to the DCJS for Training and Standards would be used to expand training provided to local threat assessment team members, consistent with the recommendations of the House Select Committee on School Safety. The amendment also provides for the development of a threat assessment team case management system.

• Provided $872,000 GF in FY 2020 to the DCJS for Training and Standards to enhance and expand the school safety training provided by the Department of Criminal Justice Services to Virginia school personnel, consistent with the recommendations of the House Select Committee on School Safety.

2020

School Security Grants• The School Security Equipment Grants program was established by the 2013 General

Assembly in the aftermath of the December 14, 2012, mass shooting at Sandy Hook Elementary in Newtown, Connecticut.

• Since FY 2014, annual $6 mil. - increased to $12 mil. in FY 20 - competitive state application grant program for video monitoring systems, metal detectors, classroom locks, electronic-access controls, visitor-identification systems, direct communications links between schools and law enforcement agencies, and other security upgrades. Maximum raised from $100,000 to $250,000 per school division beginning in FY 2020.

- 443 schools and other instructional facilities provided grants for FY 2019

- VPSA debt used for program; debt service funded by Literary Fund.

- This was sixth round of awards bringing the total number of school security projects receiving state funding through the program to nearly 2,900.

• Priority given to schools most in need of modern security equipment, schools with relatively high numbers of offenses, schools with equipment needs identified by a school security audit, and schools in divisions least able to afford security upgrades.

• Localities are required to provide a 25% match, with no required local match for school divisions with a composite index below 0.2000.

Latest press release on program grants: http://www.doe.virginia.gov/news/news_releases/2018/10-oct04-gov.shtml

Impact of Incorporating Land-Use

Assessments into the Local Composite Index

• Incorporate land-use assessments into VA Adjusted Gross Income component of LCI

(.5 *TVRE + 0.4* VAGI + 0.1*Taxable Sales)

(0.667*ADM + 0.333*Pop.

• SB 1471 (Hanger) introduced in 2019 Session left discretion incorporating into formula. Impact statement assumed one-half of VAGI component reduced by land use-assessment value.

Est. Impact: Counties +$10.2 mil.; Cities ($7.6 mil.)

21

SB 1471 Impact by County School Division

22

School Div. SB1471 Est. School Div. SB1471 Est. School Div. SB1471 Est.

ACCOMACK $17,297 FRANKLIN ($115,376) NOTTOWAY $69,480

ALBEMARLE $1,042,893 FREDERICK $214,591 ORANGE $336,871

ALLEGHANY $191,498 GILES $145,476 PAGE $28,193

AMELIA $126,463 GLOUCESTER ($193,739) PATRICK ($104,534)

AMHERST $149,000 GOOCHLAND ($123) PITTSYLVANIA $333,169

APPOMATTOX ($50,707) GRAYSON ($191,042) POWHATAN $359,624

ARLINGTON ($1,232) GREENE $180,249 PRINCE EDWARD $6,724

AUGUSTA $814,181 GREENSVILLE $15,951 PRINCE GEORGE $61,416

BATH ($24) HALIFAX $633,064 PRINCE WILLIAM ($237,906)

BEDFORD ($1,487) HANOVER $817,371 PULASKI ($5,818)

BLAND $129,919 HENRICO ($592,335) RAPPAHANNOCK $57,781

BOTETOURT $225,691 HENRY ($153,034) RICHMOND $24,499

BRUNSWICK $316,832 HIGHLAND $17,299 ROANOKE $8,379

BUCHANAN ($218,190) ISLE OF WIGHT ($116,648) ROCKBRIDGE $165,362

BUCKINGHAM $475,916 JAMES CITY ($301,130) ROCKINGHAM $1,084,938

CAMPBELL $211,113 KING GEORGE $304,443 RUSSELL $331,607

CAROLINE $486,091 KING QUEEN ($21,547) SCOTT $56,434

CARROLL $62,119 KING WILLIAM $132,847 SHENANDOAH $256,077

CHARLES CITY $24,797 LANCASTER ($188,334) SMYTH $284,003

CHARLOTTE $18,233 LEE $136,722 SOUTHAMPTON $383,963

CHESTERFIELD ($826,948) LOUDOUN ($661,749) SPOTSYLVANIA $1,620,309

CLARKE $52,836 LOUISA $2,354,764 STAFFORD $1,238,983

CRAIG ($37,361) LUNENBURG $1,098 SURRY $732,691

CULPEPER $516,520 MADISON $301,210 SUSSEX $18,567

CUMBERLAND $95,077 MATHEWS ($326,891) TAZEWELL ($101,205)

DICKENSON ($57,735) MECKLENBURG ($393,773) WARREN $879,208

DINWIDDIE $256,127 MIDDLESEX ($159,700) WASHINGTON $649,244

ESSEX ($15,049) MONTGOMERY ($152,547) WESTMORELAND ($229,155)

FAIRFAX ($7,645,826) NELSON $91,087 WISE $1,218,762

FAUQUIER $2,672,790 NEW KENT $19,745 WYTHE $201,285

FLOYD ($24,696) NORTHAMPTON ($243,521) YORK ($500,189)

FLUVANNA $576,367 NORTHUMBERLAND ($206,776)

SB 1471 Impact by City School Division

23

School Div. SB1471 Est. School Div. SB1471 Est.

ALEXANDRIA ($741) RADFORD ($21,698)

BRISTOL ($19,833) RICHMOND CITY $253,815

BUENA VISTA ($57,462) ROANOKE CITY ($108,215)

CHARLOTTESVILLE ($243,308) STAUNTON ($98,709)

COLONIAL HEIGHTS ($128,277) SUFFOLK ($121,359)

COVINGTON $254,183 VIRGINIA BEACH ($1,142,919)

DANVILLE ($183,193) WAYNESBORO $17,127

FALLS CHURCH ($116) WILLIAMSBURG ($140,612)

FREDERICKSBURG $167,962 WINCHESTER ($166,013)

GALAX ($68,520) FAIRFAX CITY ($131)

HAMPTON ($756,459) FRANKLIN CITY ($75,675)

HARRISONBURG ($376,195) CHESAPEAKE CITY ($329,167)

HOPEWELL $109,902 LEXINGTON ($25,380)

LYNCHBURG ($331,720) EMPORIA ($53,214)

MARTINSVILLE ($32,604) SALEM ($23,734)

NEWPORT NEWS ($1,213,090) BEDFORD CITY $0

NORFOLK ($1,373,099) POQUOSON ($158,808)

NORTON $14,482 MANASSAS CITY ($405,357)

PETERSBURG ($175,783) MANASSAS PARK ($119,047)

PORTSMOUTH ($398,770) COLONIAL BEACH ($55,175)

WEST POINT $35,897